I have some free time now, so I decided to learn forex. I hate read instructions, or read any ebooks about that, too hard to understand. Looking for easy to understand Forex video tutorials for beginners
What you recommend?
There are lot's of ways to learn anything in Forex. Many people say it's not worth learning. But if you want to learn and you really put the time into it then go for it. Forex is great if you have self control, the right principles, knowledge of risk to reward and understanding support & resistance.
With that you can apply basic trading principles to any methodology without making the whole learning process confusing. For example: You will only trade the EURUSD currency pair. You will use a 50 Exponential Moving Average on 4 hour time frame.
- When price is above the 50 Exponential Moving Average on the 4 hour time frame = ONLY look for LONGS / Buy trades on the 1H time frame.
- When price is below the 50 Exponential Moving Average on the 4 hour time frame = ONLY look for SHORTS / Sell trades on the 1H time frame.
You can easily determine the higher timer frame trend. Once that is determined you know what direction you should be trading on a lower time frame. You can enter when price closes above or below strong levels of support and resistance in the direction of the 4 hour time frame trend.
Stop Loss can be placed above or below the previous level of support / resistance. If your stop loss = 20 then your take profit should = 40 pips. This will give you a 2 times reward vs your risk.
You can easily double a small account starting with $500 over a 3 - 6 month period by applying these simple principles. To determine your lot size on a $500 account you can use 2% of $500 = $10 risk per trade. If the stop loss = 20 pips (take $10 and divide that by 200) = 0.05 is the lot size needed. Your goal is to risk 2% of your account per trade to gain 4%. Not every trade will be a winner but if you understand win to loss ratios you will be OK.
Example:
Each loss = 2% and Each winner = 4% (based on a $500 account)
If you take 10 trades per month and you have 5 losses x 2% = -10% and 5 winners x 4% = 20%
- 20% - 10% = 10% gain ($50) / 50% win ratio
If you take 10 trades per month and you have 6 losses x 2% = -12% and 4 winners x 4% = 16%
- 16% - 12% = 4% gain ($20) / 40% win ratio
If you take 10 trades per month and you have 7 losses x 2% = -14% and 3 winners x 4% = 12%
- 14% - 12% = -2% loss (-$10) / 30% win ratio
As you can see if you stay consistent and only trade 10 trades per month you can compare each month and analyze your data. In the example above you ONLY have to win 40% of the time to make a profit.
This is great for learning how to trade and gain consistent principles. Most people fail or quit trading in Forex because they are chasing a dream of making a crap load of money and RISK too much too FAST. Take your time. Apply these principles and you can easily learn how to trade.
